Car Insurance & Scrapyards

Grahamknott

Hi

I wish to scrap my car asap and cease from driving for a period of time. My current insurance policy doesn't expire until July. My question is this: am I subject to a 'cancellation fee' (£75)from my insurance company concerning the policy I have with them if I go ahead and scrap the car before the policy's expiry period? I would contact the company about this myself were it not for the bad blood that exists between us concerning an unrelated matter. A friend has advised me that I shouldn't worry, that it's not the car that's insured, but me. And in any case, having the car scrapped isn't the same as having 'modifications' made upon it. Is this sound advice? In addition, I am perfectly content to let the insurance policy continue to apply to me, despite the lack of a car, until it expires in three months' time. Am I right to pursue this line of action? Regards, G Knott.

fivetide

You need to speak to them I think.

Technically you could scrap the car and keep the policy running, it's not like you'll be claiming on it.

The issue is the fee is for cancelling (should one apply) so if you cancel for whatever reason then you'll need to pay it.

what you need to know is how much of the policy you'll get back (if you paid in full). i.e. cancel now get back £100 unused policy less fee = £25 in your pocket. Cancel now and £50 refund = £25 out of pocket and it would be better to let it expire.

Just be calm and ask them what the situation is. If you are pay monthly or you've claimed though, I'd just let it run.

5t.

s_b

cancellatiion fees will probably gobble up return fees and you lose a years no claim
scrap it
make sure end of life certificate obtained
say nowt to insurer

supermanjo

Thats still 4 months on your policy, so if its £50 a month, you'll be getting back around £200 - £75 = £125. Again, it all depends how much your policy is worth, if its only a few quid in savings then leave it running that way you'll get another years NCB!

PS: Don't take it to a breakers yard. Take it to a scrap metal yard. I got £156 for my old banger ford mondeo I bought as a runabout for £150! haha! The local breakers yard wanted £60!

Just a tip!

forgotmyname

You took out the insurance to drive that car, So you should cancel the policy but as mentioned it maybe a lose/lose situation.

As long as your never going to claim, So no driving anyone elses car, Or it could come back and bite you when they check your cars details and find you scrapped it.

King_Nothing

You can't have insurance on something you have no insurable interest in, once the car is scrapped, technically the insurance should be cancelled.

Quentin

supermanjo wrote: »

Thats still 4 months on your policy, so if its £50 a month, you'll be getting back around £200 - £75 = £125....

It doesn't work like that! (You don't get a full pro rata refund as you suggest!)

As the car is being scrapped, there is no downside to keeping the policy running and letting it lapse at its end date, thereby avoiding the cancellation charge.

See if they will let you suspend the policy (if so, they will give you a partial refund of premium when it ends)

tim9966

Yes you are subject to it, unless you want to keep it going to get an extra years No Claims.

Your no claims is valid for 2 years with a break, so it depends how long you plan on not driving.

Grahamknott

Hi, many thanks for the useful advice. As a matter of fact, according to my third-party insurance policy, there's no money refunded on the policy after the first seven months, should there be a cancellation for any reason. And since I paid it in full upfront, that means I won't be getting a refund. As for the cancellation fee, I need to weigh this against the need to have the car re-taxed in a few days time: i.e. should the company choose to demand the fee were I to scrap the car, I'm prepared to stick another six-months' tax on it (£110?) and sit it out until the end of the insurance period - this on the basis that I would (actually) prefer to give the money to the government than to my insurance company, who I consider to be out and out rogues. I know this is cutting my nose to spite my face, but at least I can claw back three months on unused road tax from Swansea. But yes, I will phone the company first before doing anything else, if only to protect my back. Again, many thanks for the helpful advice. Regards, Graham Knott.